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Inside the Minds—The Corporate Lawyer—Industry Insiders on the Successful Practice of Business LawPublished by Aspatore, Inc. For corrections, company/title updates, comments or any other inquiries please email info@aspatore.com. First Printing, 2003 10 9 8 7 6 5 4 3 2 1Copyright © 2003 by Aspatore Books, Inc. All rights reserved. Printed in the United States of America. No part of this publication may be reproduced or distributed in any form or by any means, or stored in a database or retrieval system, except as permitted under Sections 107 or 108 of the United States Copyright Act, without prior written permission of the publisher. ISBN 1-58762-232-7 Inside the Minds Managing Editor, Carolyn Murphy, Edited by Georgia Mullen, Proofread by Stephanie Afonso, Cover design by Scott Rattray & Ian Mazie Material in this book is for educational purposes only. This book is sold with the understanding that neither any of the authors or the publisher is engaged in rendering medical, legal, acco
Overview of Corporate Law Practice Jerry B. Black Wilson, Elser, Moskowitz, Edelman & Dicker, LLP Partner, Head of Corporate Practice Group Introduction The practice of corporate law is extremely diverse, involving intellectual, technical legal, business, judgmental, practical, relationship and personal skills. The ability to combine skills in all these areas will contribute significantly to the success of the corporate lawyer and the personal rewards and satisfaction which the corporate lawyer will derive from the practice of corporate law. To provide an overview of factors which are relevant to the successful practice of corporate law, there is discussed briefly below the role of a corporate lawyer, the corporate lawyer-client relationship, understanding the needs and objectives of a client, the success of the corporate lawyer, current trends and key issues, and some observations regarding personal issues involved in corporate law practice. The discussion is intended only as a succin
The Role of a Corporate LawyerThe role of a corporate lawyer may be extremely varied depending upon the needs of the client, the purpose or purposes for which the corporate lawyer is retained, the applicable circumstances, the expectations and needs of a client and the corporate lawyer’s personal views of the role and responsibility of the lawyer both as a general matter and as a corporate lawyer. The principal aspects of the role in general terms include advising the client, implementing the business objectives of the client, protecting the interests of the client, limiting risk to the client, providing general and transactional business advice, negotiating business and documentation issues, and drafting relevant documentation. These general statements regarding such a role are discussed in additional detail below. Advising the client. Advising a client will vary considerably depending upon the role or mandate of the lawyer and the nature of the client’s needs, but in the broadest sen
The Lawyer-Client RelationshipThe lawyer-client relationship can vary considerably, depending upon the business and needs of the client. It can also depend upon the client’s reasons for retaining the lawyer. In the case of general corporate clients, the work may include a full range of services such as contracts, real estate, human resources, marketing, and transactional matters involving acquisitions, divestitures and financings. Some clients may engage a lawyer to handle a specific transaction, such as an acquisition, divestiture or specific securities law matter, while others may engage a lawyer as general counsel, contacting the lawyer on a regular basis with questions or issues that arise in the course of doing business. Often the retention of a lawyer may relate to a specific matter but later be expanded to another or to a full range of matters. Often the corporate lawyer can provide business advice and insight as well as strictly legal advice, depending upon the nature of the cl
Understanding the ClientUnderstanding a client’s business is essential to providing outstanding legal services. Therefore, extensive research and investigation of the client’s business should be done when the lawyer is retained and it should be continually updated. To fully understand a client’s business, a primary source should be written materials relating specifically to the client’s business and more general literature relating to the industry in which the client conducts business. Financial statements and marketing materials are particularly useful. If the client is a publicly owned entity, SEC filings are especially informative. After reviewing such materials, a discussion with the client’s representatives responsible for different corporate and operating aspects of the business is important, not only to understand the specific business but also to develop a sense of relationships between the lawyer and the representatives of the client, both inside and outside the client’s organ
Success as the Corporate LawyerA key element to the success of the great corporate lawyer is the ability to distinguish the importance of issues, identify the client’s priorities and develop creative, effective solutions to problems and issues. In any matter or transaction, it is extremely important to distinguish between issues that have significant financial and other consequences and are critical or otherwise material and those which are not of significant consequence to the client. This recognition will determine the amount of focus and importance the lawyer devotes or attributes to a given issue. The lawyer must also have an understanding of the client’s priorities in deciding which issues are of greater importance. A third important factor is to find or create solutions to problems, which may prevent a matter from proceeding. In a sense, a lawyer must be a dealmaker and not a deal killer. Clients want to know how something can be done and not why it cannot be done. A great corpor
Trends and Key IssuesIt is important that the lawyer be fully informed of new developments to provide services that may be required due to changes in the law and the businesses of clients or in the manner in which legal services are provided. Being aware of law firm mergers, services provided in-house or by alternative service providers, and the costs of such services is also very important. It is critical to be aware of changes in applicable law, to think about what changes may occur prospectively in the law, and to determine how such changes may affect the businesses of clients. The first factor is to be aware of new developments. This generally involves the use of information services and publications. Upon becoming aware of new developments, the next step is to assemble sufficient relevant material and information. The lawyer may decide to supply a general memorandum or newsletter to clients relating to the new developments. If the new development has specific relevance to the clie
Personal ObservationsThe practice of corporate law can be a stimulating, satisfying experience. However, certain developments in the practice of corporate law may change the nature of the traditional experience of a corporate lawyer. For example, it would be desirable for the lawyer to maintain a more traditional relationship with the client instead of having to serve as a type of agent for governmental agencies, which appears to be one effect of the Sarbanes-Oxley legislation. Because of the increased size of major corporate law firms, the commercialization of the practice of law, and the need for lawyers to provide services internationally to support this growth, the more collegial work environment in law partnerships and the practicing of a profession have suffered. The practice has become more of simply being engaged in a business. For success a corporate lawyer should enjoy the work, be responsive to clients and make certain that services are value-added. Clients invariably want t
In Partnership with the Client T. Hale Boggs Manatt, Phelps & Phillips, LLP Partner, Co-Chair Business & Transactional Division The Successful Corporate Lawyer Being a successful corporate lawyer is more than being a capable legal technician or someone who documents a company’s transactions. It’s more than understanding a set of laws and regulations that govern a client’s business. In my experience, being a successful corporate attorney must be far more collaborative than that. Although my involvement with clients does not rise to the level of business partner, I’m there to provide objective, independent advice, whether or not it will generate a profit. I attempt to give a more holistic analysis, rather than an impersonal examination, of how the law applies to the client’s particular facts and business circumstances, and ultimately to assist the client in achieving its business objectives. That might have a lot to do with the portion of our firm’s client base with which I work most clo
In Partnership with the Client
The Lawyer-Client RelationshipDedication to clients is the key. You need to have the mindset that what you do is not just a 9-to-5 job: It is your career and it defines you professionally. It’s relationships with clients – the way clients feel about you and how you feel about them – that really matters. In my view, this is what differentiates great lawyers from good ones. There are many good lawyers who can do a competent job of putting together documents and providing legal advice. There are a lot fewer who are truly dedicated to a client’s success and who measure their success as an attorney by how well the client does. I want clients to feel they are getting excellent value for the cost of my services. Legal services today are incredibly expensive, especially at the larger firms. When a client makes a decision to involve me (or any lawyer) on a project, that client is making a major investment. My principal goal is to guarantee that when the dust settles and the project is done, the
Making ConnectionsAnother aspect of being a good business lawyer is knowing when and how to match two clients, or one client with a third-party, in a way that results in something good for them, even if there’s nothing foreseeable in it for me. That happens all the time. I have a company that’s looking for money, and I have an investor who’s looking for a particular type of investment. I introduce them, they make an investment, and everybody’s happy. Sometimes I’ll get to work on that deal and sometimes I won’t. But you can be sure that they’ll both remember, and at some point – whether it’s a day, a week, a month, or five years later – they will come back to me. It always happens. That is very rewarding. But I think it is something you can only figure out over time. If you’re looking at client development with a short-term view, you won’t often get the return on investment you anticipate. But over time, it usually works out.
EfficiencyI think some firms have a lot of people around who really don’t add value, who merely add hours to the time sheet. Clients are more savvy these days and more price-sensitive. They understand the importance of efficient staffing. I believe a leanly staffed matter, where each lawyer or legal assistant involved adds something specific and particular, is critical. That way, the lawyers, especially the more junior lawyers, feel valuable; they don’t feel as if they’re just cogs in a big machine. The client also understands that you’re doing them a good service – you’re not replicating and generating more billable hours than necessary. With this system, the associates and junior partners working with me have a lot of interaction with clients almost immediately. I like nothing better than when a client begins to feel comfortable calling a junior person directly. I think that’s what it’s all about – developing that level of confidence in junior people and having them invest in the cli
Preparing for NegotiationsIn preparing for negotiations, before I make that conference call or participate in an all-hands meeting, I spend a lot of time learning about my client’s objectives, if I don’t fully understand them already from past projects. I also do my homework on the other parties. What are their backgrounds? What are the personalities of the other side’s principals? If I don’t know the other lawyers, I try to find out about them. So I spend a lot of time. And I do it myself, by the way, rather than simply being briefed by an associate. I can have people help me by doing the research, but I’d rather spend the time studying the material myself to be as prepared as possible. Every transaction is as much about who the other people are as what the deal is. The personalities and backgrounds are often indicative of how the negotiation will go, often more indicative than what the term sheet says. For me, negotiations are all different. I don’t approach the negotiation with the
RiskI am a firm believer in the old adage “Nothing ventured, nothing gained.” The most successful companies, and frankly the most successful people, are those willing to take risks. It’s important to have a hedge, though. In other words, while it’s okay to be aggressive and enter into speculative transactions, it’s only okay if you also have other transactions or investments that are pretty safe, so you have other secure sources of revenue. I think about it in the same way I think about an investment fund. You’ll have your risky investments that, if they pan out, could bring spectacular returns, but they very well could end up with a zero. And you’re going to have your T-bill sort of investments, which will have a slow and steady rate of return, but will be consistent. Companies, in strategizing about their business objectives, really ought to do the same thing. Take a flyer on the acquisition of that little startup company across the country, because if it works out it could have a hu
Trends in Corporate Law and BusinessTrends in business are inevitable. As sure as the sun will rise tomorrow, businesses and industries will experience ups and downs. While it is impossible to predict these trends with certainty, being able to recognize where we are in a particular cycle is highly important. A significant part of my practice in recent years has involved the venture capital business. Obviously, this industry has undergone a tremendous amount of change in the last ten years. To be a successful counselor to the venture capital industry, you need to recognize the cyclical nature of the business. Again, it comes down to taking a long-term view. For instance, regarding fund raising for a venture firm and dealing with institutional investors – large pension funds, universities, the big investors – three years ago the good venture firms could effectively dictate terms, because investors were lining up to write checks. Now, you really need to think forward and realize that’s no
Industry ConsolidationFor the future, I think we will continue to see corporate consolidation. As long as the antitrust rules remain as relaxed as they have been, we’re going to continue to see it – not just here, but internationally, with increasing consolidation of large multinational companies. I have concerns about that on a number of levels. I worry about consolidation and roll-ups and the ability of middle market companies to sustain themselves in a market increasingly dominated by gigantic entities. From a more general perspective, I’m not sure it’s so great for our society. Consolidation reduces competition. It drives product and output to a lower common denominator. Quality and service suffer when the economy is dominated by giant players that can get away with products not quite as good as they might otherwise be with more competition. I wonder how that will play out long-term. I wonder if there will be a backlash, the same as with corporate ethics, where somebody just says,
It’s a Customer Service Business John M. Coogan Wolf, Block, Schorr & Solis-Cohen Vice-Chairman Corporate Department The Role of a Corporate Lawyer A corporate lawyer must be able to serve as a counselor in every matter likely to be important to the decision-makers of a business. The people who have ultimate responsibility and authority for a business of any size, from sole proprietorships to General Electric, want to be able to ask their lawyer almost anything and get a response that provides value they couldn’t get from anyone other than their lawyer. They want not only information about what the law is, but also a special blend of technical and practical advice that only a lawyer’s perspective can provide. These business leaders approach their lawyers for a full and complete answer. To fulfill the role properly, a corporate lawyer must be able to handle any topic germane to a business and address nearly every type of legal question. The questions and problems will range from minute
Building the Client BaseTo state the obvious, it all starts with the clients. No clients, no practice. To do the interesting work, or any work, you need clients, and because every firm periodically loses clients for a variety of good and bad reasons, you need a constant flow of new business in the pipeline. Our firm is fortunate to get a number of new clients by some combination of reputation and word-of-mouth. Our firm’s name is well-known, particularly in the mid-Atlantic region, and referrals often come from current clients and that loose confederation generally known as “friends of the firm.” We also get referrals from other law firms because of a conflict that firm has in representing two sides of a transaction. We get other business from people who once worked for current clients but started their own businesses or moved to new businesses; when a legal need comes up, they think to call us. Finally, there’s old-fashioned marketing: trade shows, speaking engagements, phone calls, b
Keys to Practice Success Your Ethical Foundation This was the One Rule long before anybody ever heard of a company called Enron: To be successful in corporate law, you must do the right thing. You must have a value system rooted somewhere, remember you took an oath, and remember that all the money in the world isn’t worth your reputation or your word. That’s the starting point, and it’s the ending point. Otherwise, what’s the point? Once you’ve established your own ethical and moral base, the harder part starts. Many lawyers like a bit of certainty. We went to law school and gravitated toward the profession because we saw an important distinction between right and wrong, permissible and impermissible, proper and improper. But to see things through the client’s prism, you need to learn to adjust a little bit mentally to the fact that “risk” for a business executive is not the same as “risk” for a lawyer or for the accountants, the other groups of professionals to which business executiv
The Joy of ServiceYou must remember that when you take away the education, the oath, the professional status, i.e., the lawyer’s trappings of office, you’re in the customer service business. At bottom, it’s not a whole lot different from waiting tables. As a waiter, you have to know what you’re serving, how it’s made, how it’s served, and the customer expects you to know it well. You must give customers what they want, anticipate their needs, fix their problems, make them feel good about the whole thing, and not charge them too much for the privilege, or they won’t come back and pretty soon you’ll have an empty restaurant. For the lawyer, the analogous tasks are answering the phone, taking the clients’ problems seriously, providing expertise they don’t have (and likely don’t want considering the boring details) and do it for a price that makes sense for their businesses. You have to love being in a service business. You have to love getting the phone call: “Hey, can you help us?” Can y
The Skills of PracticeYou also have to be able to handle many things in your head at once. I started my legal career clerking for a well-known justice on the Delaware Supreme Court. Justice Moore distinguished between lawyers who were very good as long as they focused on one task at a time versus those who kept seven matters flying at once, and stressed how important it was to be part of the latter group. Some lawyers are very good at thinking about one thing at a time, but to be successful you have to keep seven or eight things in the air at once. You obviously need to delegate tasks such as research and drafting. But you have to be able to think about more than one thing at once if you want to have a successful large-firm practice. Otherwise you’ll never stay open. Of course, there’s a trick to the talent identified by Justice Moore, which is now called “multitasking.” Some of the best advice I ever received as a desperately busy mid-level associate in New York came when one of the p
Dealing with Change in the IndustryEach industry is evolving constantly, and in the last quarter of the 20th Century, change arrived in a big way to the practice of corporate law in the U.S. Having an active practice and being involved in marketing and client development keeps you well attuned to changes. You can read it in the clients and their expectations. You see other attorneys, and you read the trade papers. It’s really an ongoing process. In any dynamic system – and ours is no different –step one is to stay close to your clients, because if you’re a little slow to react to a change, they’re less likely to be terribly upset as long as you’re generally performing. But you have to be leading the way a little bit. You must be thinking about ways to change and improve all the time; if you’re in that mode, you probably will handle it pretty well. You need to be the one constantly tinkering with your approach, trying to do more, trying to do better. Improvement and growth have to be pa
The Intersection of Law and Business… In The Practice of Corporate Law Ronald J. Frappier Jenkens & Gilchrist, A Professional Corporation Corporate Practice Group Leader The Role of the Corporate Lawyer The corporate lawyer must become part of the fabric of the transaction and facilitate its orderly conclusion. Although that may appear fairly simple, it is one of the factors that distinguishes the simply good from the great corporate lawyer. Great corporate lawyers have the ability to create and become part of the momentum of a transaction and to align the parties into agreement to finalize the transaction. It is the responsibility of the corporate lawyer to work among the legal, practical, emotional, rational and irrational issues and differences that exist among the parties in order to draw the transaction to an efficient conclusion. Business sense is, obviously, a valuable attribute in a corporate lawyer. If the attorney attacks a transaction as a technician only, then that approach
The Intersection of Law and Business… In The Practice of Corporate Law
Interacting with ClientsA meaningful degree of due diligence is performed in taking on a new client, depending on who the client is and what its objectives are. If it is a large, significant, public company, one can look at its public filings and get a description of the company and an understanding of its strategy and direction. If it is a start-up company – during the Internet boom quite a few technology-driven companies were formed – the diligence involves getting a sense of its business plan, vision and strategy, where it is going, how it will accomplish its goals, and analyzing whether we believe from our experience that this makes sense or is workable. One must filter through that. The diligence is not necessarily designed to conclude that the prospective client has money in the bank and that it can pay its legal bills. It is really designed to determine if it is a viable entity and if the business plan has meaning and potential. Would we like to be plugged into this? Can we help
Assessing and Communicating RiskIt is critical for the corporate practitioner to find some manner to understand and communicate to his client what the implications and risks of various actions are. A large but real variable among lawyers is how they quantify these risks and how they factor risk into their analysis in advising their clients. On one end of the spectrum are attorneys who do not care about the risk. Either it does not matter to them, or they don’t recognize it, or perhaps they don’t believe it exists. On the other end of the spectrum are attorneys who see everything as a risk. As a result, they have difficulty with any magnitude of risk. They cannot scale it, they cannot weigh it, and they cannot synthesize it into anything meaningful in order to make decisions. In meaningful risk assessment, the corporate attorney must have the cognitive ability to grasp risk, synthesize it into the equation, and then move forward based upon a keen understanding of how to weigh that risk
Values and EthicsOne of the things very important to us – and something our clients understand very well – is that we can never advise them and we never will advise them in a manner that distorts reality, shades the truth, or violates principles of ethics or legality. We all must operate in the world and in the business environment according to a certain set of standards. Our view is inspired from our personal beliefs that things have a tendency to work themselves out correctly if handled correctly. That is almost something that you could define as “deal optimism.” It is an optimism that our objectives will be met – we will achieve this – if it is to be achieved properly. If we cannot achieve it properly, we will give it up. There is probably great gain to be made through illegal practices or improper ethics, but that is not appropriate and it is not lasting. Because of that overlay, our clients, when they come to us, may already know the answer. We will say, “You cannot do this becaus
Key IssuesWe think the issue that has a number of companies figuratively scratching their heads is how we are going to behave in this reactive environment, which allows a level of criminal liability for chief executive officers and chief financial officers who lie or mislead the public. What level of liability is there for directors trying to behave in a manner they believe is responsible in discharging their fiduciary obligations to direct the company from the board level? The issue there is what can we do to keep ourselves from going to jail or being perceived as being worthy of jail, or how do we operate normally without this overlay from the public looking for liability and problems, and seeking retribution? To us, one of the larger issues is finding good corporate directors willing to serve in this environment of heightened scrutiny and heightened liability. How does a company get back to its core business and perform and function without spending an inordinate amount of time comp
Necessary Personal AttributesOne thing we find surprisingly important as corporate lawyers is the ability to be able to relate on a personal level to the persons involved in the transaction. This person could be the lawyer’s client, the lawyer on the other side of the transaction, the investment bankers involved in helping your client raise money or the accountants involved in helping to understand and describe the accounting end or the financial performance of this company appropriately. What is exceedingly important is the ability to connect with this other person. Attorneys have to understand what they are trying to achieve, and they have to help others understand what they need to do. Too many lawyers are able to perform what is asked of them, but they are not able to reach beyond that and understand the full implications of what clients really require in the context of the transaction or in the context of the broad issues of the business plan and objectives of the company. That ma
Succeeding as a Corporate LawyerThe best advice I ever received – and maybe to me it is the best because I received it very early in my career – became an element of the foundational framework for understanding my practice, corporate law, life, clients and everything. When I think back on that advice, it seems basic and simple, but so key and important to me. A senior attorney said something to me that altered my focus and understanding. The attorney said in very simple language, “Put yourself in the mind of the client. That is what you need to do.” I took that and extrapolated that into my views of the intersection of law and business and fit it all together. What that really meant to me was: What are they thinking? What are they really feeling? What do they want? What do they expect? Why are they coming to me? What do they need? What would they like to hear me say? How can I help them? When clients say that they have a question for me, I put myself in their minds. I ask myself those
The Ethical Role of the Corporate Lawyer Michael H. Friedman Pepper Hamilton Partner, Commercial Department Golden Rules of Corporate Law The role of corporate lawyer is to assist a client in achieving its business objectives in a manner that is efficient and consistent with the client’s expectations. Sometimes these expectations are based on an inaccurate understanding of either the law or the business context, and the lawyer must clarify with the client the validity of the client’s expectations. Although business transactions often involve negotiation over competing interests, resolution of these competing interests in a manner that accommodates the needs of all parties often ensures that the client will have a long-term relationship with other transaction participants. Golden rules for the corporate lawyer: (1) maintain a mastery of the law; (2) understand the client’s objectives and constraints; (3) be open and honest with clients and colleagues; (4) work hard and pay attention to
Day-to-Day WorkHow a corporate lawyer spends the day depends upon his or her status. Younger attorneys spend most of their time learning the law and technical skills, such as contract drafting, research, preparation of registration statements and negotiation. Senior lawyers spend more of their time counseling and providing strategic advice. I work with clients on issues related to corporate governance, public disclosure and securities law compliance, structuring mergers and acquisitions, financings and joint ventures. When clients come to me with a proposed transaction, they often have a vision that has not been brought into sharp focus. I help them focus, which will sometimes lead them to realize that they haven’t thought through all the issues associated with their transaction. I help clients understand the materials issues that will arise in implementing a transaction, so they work toward achieving their true objective and understand, at the outset, what is likely to confront them a
Negotiation TacticsThe most important aspect of negotiation is a thorough understanding of what the client is trying to achieve at the macro and micro levels. It is also important to understand what the other side wants. I endeavor to accomplish my client’s objectives in a manner that accommodates the objectives of the other side to the maximum extent possible. I do not use emotional appeals and find attorneys who act emotionally in negotiations a bit annoying and rarely effective. I have a similar reaction to use of strong-arm tactics. Instead, I seek to articulate why my client’s objectives make sense in the contractual context. Where the other side has a different objective and is resisting what we want, we try to pinpoint what is motivating the other side so that we can determine whether we can modify the transaction in a minimalistic way to accommodate what the other side wants without forfeiting what we want. Ultimately, we want to ensure that the client’s expectations are met an
Changes in Corporate LawCorporate lawyers deal constantly with change. Maintaining a mastery of the law and transactional developments is critical to staying on top so that you can guide clients through different transactions and provide guidance on emerging trends. I read constantly, focusing on both new laws and interpretations of existing laws. Also, the more transactions you are involved with, the more you understand industry trends. It is important to be flexible. You must help clients take advantage of new opportunities and efficiently meet new challenges. One cannot overstate the importance of keeping current with changing laws and trends. Keeping clients up to date on changes in corporate law depends on your relationship with them. Within the past year, there has been tremendous change in the corporate governance context; new rules have been adopted in response to the scandals. We have provided our clients with regular updates. For some clients who have sophisticated in-house c
The Fundamental Role of the Corporate Lawyer—and How to Succeed in it Stuart L. Goodman Schiff, Hardin & Waite Practice Group Leader, Corporate & Securities What the Client Wants and Needs When I think of the fundamental role of the corporate lawyer, I start with the concept of helping the client achieve its objectives. I remember one of my law school professors at Harvard, Professor Casner, who was a very confident – some would say cocky – guy who strutted around the stage as he was lecturing to us. At the end of the year, he said, “There’s always a way to achieve the result that your client wants. It may not be direct, it may not be obvious, and if you’re not smart enough to figure it out, give me a call – my consulting rates are reasonable.” He was only half joking. The essence of what he said was true: There almost always is a way to achieve the desired result. The challenge is to find it. Meeting that challenge is the way good corporate lawyers can be useful to their clients, addi
The Client’s PerspectiveFiguring out what the client needs also helps you think about things from the client’s perspective. That’s another element of what makes a great corporate lawyer – the ability to think about things the way the client would without losing the legal perspective. That’s the way you can add value because you can not only understand the business perspective but also bring to bear your legal expertise to help the client solve a problem. After all, the matters we are asked to deal with are always mixtures of legal and business issues. Clients are grateful when you understand the business issues and factor them into the decision-making process. Clients also want us to make a recommendation, not just say "on the one hand . . . but on the other hand . . ." Learning about business in general, and clients and industries in particular, will lead you into non-legal areas. Given the recent accounting and related financial disclosure scandals, one of those areas is accounting.
Creativity and ConfidenceCreativity is another critical aspect of helping the client achieve its business goals. To be truly successful, you must be creative . . . to think “out of the box.” One of my partners, Ron Wilder, has been extremely successful in doing that. I recall a situation in which a big corporate client had a commercial lease that everybody said was unbreakable. Ron thought about it for a while, we brainstormed about it, and he came up with maybe ten theories, which would enable the company to get out of the contract. At the outset of the process, no theory was too silly to exclude. Then we did preliminary research on all ten theories. Three or four of them were discarded because they were so far off the wall that they just weren’t reasonable. We winnowed the list down and came up with two or three that might work. We did further research on those legal theories and on the underlying facts and came up with something we thought would work. It really astounded the lessor
Good Judgment, and the Difference Between Knowledge and WisdomGood judgment and problem-solving skills are related to creativity, and some people are just better at that than others. I see many brilliant young lawyers come out of the best law schools in the country. If you look at their academic records and test scores and talk to them, they’re as smart as whips – but not all of them become great lawyers. One reason is that it takes good judgment and problem-solving skills and some of the other things I mentioned to become a great lawyer in any field, not just corporate law. I call this the difference between having knowledge and having wisdom. Acquiring wisdom as a lawyer takes a lot of experience. When I came out of law school, I thought I knew a lot. I was disabused of that notion quickly. One thing I learned is that you can have a lot of knowledge, but the ability to apply it, the ability to solve problems and exercise good judgment, comes with experience. There’s no easy way to ge
More Thoughts for SuccessTo be a great corporate lawyer, you must listen to what your clients and others say. I remember somebody telling me, “You don’t learn very much by talking. You already know what you’re going to say, but you can learn a lot by listening to others.” Taking the time to listen also lets you take the time to think about the issues you’re dealing with. It is so easy to just react without thinking. There’s so much pressure to do things quickly these days, in this age of instant communication. Someone emails you a 100-page document, and an hour later they expect your comments back. It is important to resist some of those pressures to the extent that you can and take time to think – that includes thinking about the bigger picture and not just the details. Sometimes you can get overwhelmed by the details. I also see many lawyers who seem only to be trying to win points negotiating a transaction without really taking into account the bigger picture or looking for the win/
Special Advice to Young Lawyers -- Passion for the LawMy primary advice to a young lawyer is to find your personal strengths and build on them. You can also work on your weaknesses, but your strengths are what are really going to make you successful. You should think about what they are, figure out how to make the best use of them and build on them. Related to that, I think of passion. Passion may seem an odd word for corporate lawyers, but I’ve always thought that if you love your work, it’s not really work and you’ll do a much better job. Something I read recently seems pertinent: Figure out what you love to do and then figure out how to make a career out of it. For people who choose the law as a profession, there are many different kinds of lawyers and many different kinds of law to practice; hopefully, there is some aspect for which you really have a passion. You ought to figure out what that is. It is likely that it will involve your personal strengths. When I was summer associate
A Few Thoughts on Economic and Business TrendsAs I look back over 40 years of practice, and also try to look forward, I think that there are long trends. The pendulum swings back and forth . . . usually too far in one direction and then too far in the other direction. I have seen stock market booms and busts, periods of time when there were initial public offering booms and other times when maybe for eight or ten years nobody was going public because no one was buying stock in IPOs. We as lawyers have to think about the bigger picture and about the trends. With all the accounting scandals and bankruptcies of first the dot-com companies and then the energy trading and telecom companies, and calls for government regulation (like the Sarbanes-Oxley Act that was adopted hurriedly last summer), you see the pendulum swing too far; the unintended consequences already are starting to occur. One of the pundits quipped about the Sarbanes-Oxley Act that business executives should be happy that no
From Acorns to Oaks Carmelo M. Gordian Brobeck, Phleger & Harrison, LLP Chair, Business & Technology Group The Role of a Corporate Lawyer There are many different types of corporate lawyers. When I think of a corporate lawyer, I think of an individual who advises boards of directors and assists management in choosing a strategic direction, focusing on the legal ramifications of their decisions, coupled with his or her understanding of their business. I envision a gray-haired attorney sitting at the boardroom table discussing matters of consequence with the board of directors. There are two basic types of clients that we generally advise and we take a very different approach to these two clients. At one end of the spectrum, we represent Fortune 100 companies, some of the largest corporations in America. One of the keys to this representation is chemistry – likely with the members of the company’s legal department, because major corporations will have general counsel, probably multiple l
Succeeding as a Corporate LawyerIf you talk about the difference between a good lawyer and a great lawyer, I believe good lawyers are thought of as technical lawyers: They can do the job, they do it right, and they are meticulous in how they approach problems they are trying to solve. I think great corporate lawyers are those who develop over time a level of respect so that their opinions are sought by boards of directors and members of management. I’ve heard it said that one of the things that makes a corporate lawyer great is instincts. The same can be said of business people in general. Great lawyers simply have better instincts. They understand the problem, they understand what is trying to be addressed from a problem-solving perspective, and, instinctively, they come up with better answers than you get from just a good technical lawyer. I like to think of great lawyers as problem-solvers. Great lawyers are also good teachers. As a corporate lawyer, you try to be careful not to mak
Negotiating for SuccessWhether negotiating documents or resolving a dispute, the way to succeed is to have an early, thoughtful conversation with key client decision-makers. When you go into a negotiation, you must have a result in mind. You should start the negotiation at a place that you believe will get you to the end result. I think people often make the mistake of going in and starting where they want to end up, which makes accomplishing your goal difficult. You have to recognize that it is a negotiation and there is some give and take over the course of several hours or over the course of several days. You have to be thoughtful on the way in, think about your objective, and then plot your course until you end up where you truly want to end up. I think another key element of successful negotiation is that those who are particularly successful understand the ethic of creating a win/win situation. If both parties walk away thinking they’ve won, you have done a very good job. The way
Changes in the Business WorldWe try very hard to inform our clients of relevant major developments in the business and legal worlds. In addition to periodic updates, I think it is equally important that you have an ongoing dialogue with your clients. You need to meet with them as often as you can – which is probably going to be no more than once every month – to talk about developments in their world and issues which require attention. We have had a tremendous number of developments over the last several months concluding with the passage of the Sarbanes-Oxley Act. As a result, there has been a significant number of communications between our firm and our clients. Although historically clients might occasionally comment that we weren’t communicating enough, I would have to say in the last several months that clients are saying, “We are getting so much information; we just want it boiled down to one or two key issues, if possible.” The economy has had a pretty dramatic impact on law fir
Corporate EthicsI do not subscribe to the notion that corporate ethics have been changed by recent developments. While there is greater sensitivity, the fact of the matter is that good lawyers have always advised their clients to do the right thing. It is unfortunate when lawyers forget their role: Being a good lawyer is advising your clients to do the right thing. In my experience, boards of directors and management want to do the right thing. There is a perspective that the world is filled with evil executives who want to abuse the system at every turn. I just don’t believe in this view of the world. I believe that, fundamentally, the vast majority – meaning 99 percent – of all executives out there are trying to do the right thing every day. Unfortunately, our views have been colored most recently by the 1 percent that seems to not put doing the right thing as a priority, or they misperceive what the right thing is and seem to attempt to justify it in their own minds. When the rest o
Future Direction of Corporate LawWe are entering a period in which we will see a great deal of regulation including the adoption of new rules and regulations by the SEC, and other regulatory authorities. We are going into a period that will be challenging for executives because they are going to have to understand a great deal more about the legal system. The role of the board of directors is fundamentally changing. Sarbanes-Oxley has absolutely changed the rules of the game. As time passes, these changes will become even more important and noticeable. Boards are going to become much more involved in decision making and in the general activities of their corporations. Boards have always been involved, but their responsibilities have been ratcheted up by the new law. Without a doubt, this is the most significant development in corporate law in many years. I’m concerned that there is not enough sense of community on the part of law firms. There is no question that we have become a busine
Values, Commitment and Teamwork—The Foundation of the Exceptional Corporate Attorney Thomas W. Hughes Winstead, Sechrest & Minick, PC Chair, Corporate SectionThe role of the corporate lawyer has evolved over time, but has always been one of mutual trust, of giving valued counsel to the client and helping the corporate client achieve its goals. As the business world has grown in complexity, the corporate lawyer has also become a team leader, managing the relationship of the client with various specialists and managing the efforts of those specialists in providing the highest caliber of legal services effectively and efficiently. The Role of a Corporate Lawyer – The Relationship The corporate lawyer is fundamentally a relationship-oriented counselor focused on facilitating the strategic goals of the corporate client from a business and legal perspective. In its highest form, it is our responsibility to act as a sounding board and business advisor to senior management on matters of the co
Successful Practice – Unwavering CommitmentTo be successful as a corporate practitioner, one must have first of all an unwavering commitment and devotion to providing an extraordinarily high quality of service and counsel. Achievement of the client's goals on a given project can oftentimes require long hours and tenacious commitment to the completion of task within the timeframe allotted. In these efforts, the successful corporate lawyer must recognize that the practice of corporate law is at one level an intellectual exercise, but at the same time, it’s extraordinarily pragmatic: e.g., corporate lawyers deal with real-world problems and must be adept at finding real-world solutions. There is a high level of intellectual effort, but the corporate lawyer must be able to bring that down to the practical, to best accomplish the assigned task. That process involves not only the use of intellect, but also interpersonal skills and an extremely high level of common sense. Accordingly, it is c
Negotiations – Finding the Motivating FactorThe preparation for a negotiation begins with a very thorough discussion or set of discussions with the client about just what its particular goals are. Some or all of the following questions are important: What is the client trying to get out of the particular project that is under consideration? What are the key components that must be retained or achieved to reach the client's goals? What other aspects of the project are secondary goals, nice to achieve but not critical to the achievement of the client's goals? What aspects or matters must be avoided if there is to be a successful outcome? Sometimes the outcome can be as straightforward as determining a ceiling price, beyond which the project does not make economic and business sense. At other times, a critical aspect to be avoided can be ensuring that the project or a component of the project does not cross a regulatory or governmentally imposed threshold that may make the project unecono
Teamwork and Efficiency – The Backbone of Any RelationshipDealings in today's business world have become increasingly complex due to a variety of factors: an increasingly hostile competitive environment; increasing globalization of today's markets; advances in technology as they affect the business; and a complex array of regulatory concerns and litigation risks, among others. These factors have had and will continue to have significant ramifications for the corporate client and the corporate practitioner. Most notably, this requires a higher level of specialization than in years past, and the skilled corporate lawyer should make every effort to approach complex corporate projects as one team: both the client and the law firm, together with other professionals outside the corporation that need to be involved. The best approach in staffing a particular corporate project is for the team leader or relationship manager to assess the project with other experienced lawyers from other areas o
Perspective and Independence – The Value of Outside CounselIn our practice, as corporate lawyers we, by and large, represent the corporate entity. The corporate lawyer recognizes that the corporation is our client. As corporate lawyers we are charged with the task of acting in the best interests of the corporation. The best law firms will emphasize this, and it is a key principle in these firms' practices. This has always been the touchstone of corporate law, even though recently it has been the subject of renewed regulatory and legislative attention. Independence from the client is one of the most valuable characteristics that an outside law firm brings to the relationship. Representing the client's best interest and counseling them on their legal needs is only effective when both the attorney and the client know that the advice starts with an unvarnished view of the particular issues involved and then is based upon full and independent analysis. It is clear that this independence and
Technology – The Tie That BindsThe business world and the technology that provides the tools of the corporate lawyer are evolving at an ever-increasing rate. Twenty years ago, there were photocopiers, but word-processing mostly consisted of memory typewriters. For many, “cut-and-paste” involved scissors and glue. At that time, most delivery of printed material was done via the postal service. Since then, word processing has matured, faxing became first a novel new way to communicate, then ubiquitous and now a fading tool, overnight courier services sprang up and became the norm, the Internet expanded from academia to everywhere, email was invented. The practice of corporate law has changed along with these developments. Cycle times between receiving questions or comments and getting out the answers or revisions have shortened dramatically. Clients now expect seamless interconnectivity of documents and databases, instantaneous transmission of data, documents and other information via th
New Legal Developments – Communicate Timely and EffectivelyEvery corporate lawyer must keep up to date with new developments in his or her area of legal expertise and in business and law generally. Each corporate lawyer will be responsible for particular client relationships and will be on the lookout for developments that would be of interest to those clients. In addition, a high quality law firm will actively train its practitioners, both as to developments in their particular area of expertise and in areas that may impact their clients or their practice. Law firms will send out client alerts that are practice-oriented or industry-oriented rather than individual-lawyer-oriented. Specialists must stay up to date on what is going on in their area of expertise and then should communicate to the other lawyers in the firm items that may be vital or of interest to them and their clients. It is important that the corporate lawyer emphasizes being sure that clients are kept up to speed with
Recent Changes and the Future – Where Do We Go From Here?Recently enacted laws and new regulations have changed many aspects of the business world and the practice of corporate law. Privacy issues are also very important in this day and age. As we continue to move forward in an area of enhanced technology, the interplay between technology development and intellectual property law, as well as general corporate practice, has created a significant area of concern for corporate lawyers and clients. There is no doubt that the practice of corporate law has changed significantly. The overall trends that affect the breadth and depth of corporate practice will be with us from now on. It is not in the nature of our society for things to become simpler. The complexities faced by corporate lawyers and their clients require the application of a team – the right specialist has to be involved in dealing with the appropriate issues. We are no longer in an environment where one practitioner can expect
The Good and the Great in Corporate Practice Michael L. Jamieson Holland & Knight, LLP Chair, Business Law Department The Role of a Corporate Lawyer Few aspects of the private law practice provide the diversity of experiences, intellectual challenge and opportunities for creativity as the corporate practice. A corporate lawyer plays a dual role. The first element requires the lawyer to be current on the technical aspects of corporate legal issues – to be a specialist in corporate law, securities law, and related disciplines that are important to a corporate client. The second is more of a general advisory role that involves knowledge of the client's business, undivided loyalty to the client’s interests, and serving as an objective sounding board for the client with respect to legal issues. The most important characteristics a corporate lawyer can possess are undivided loyalty and an understanding of the client's business and strategic objectives. It begins with knowing the client’s bus
The Lawyer-Client RelationshipWith potential new clients, the first question I generally ask is what they expect in a lawyer. I also inquire about a corporation's governance and internal counsel structure, because that often determines the kind and level of skills that we will be required to provide. From me, prospective clients want to know the level of my prior experience – and my firm’s prior experience – in their area of business activity. My initial conversation with a potential client is personalized, but I function as a member of a large team and strongly believe that exceptional service to corporate clients is a team sport. The kind of interchange I have with clients is from the perspective of a member of a team, which will include the client’s law department, and not just an outside advisor working in isolation. A successful lawyer team incorporates specialization, unselfishness and commitment to the client’s interests. In my firm, which is an international firm with multiple
Changes in Corporate LawWe always want to be on top of change affecting corporate law. My firm was the first firm, for example, to announce the establishment of a national, multi-disciplinary corporate governance practice group. We announced it the day before the Sarbanes-Oxley bill was signed. We also try to be innovative. When the SEC adopted a new regulation governing corporate disclosures to securities analysts, we conducted informational seminars by videoconference for the national and local business press. I believe that we were the only firm to do so. We like to think that our efforts contributed to a better-informed public concerning the effect of the new rules.
Recent DevelopmentsOver the last few years, there has not been much change in the law of corporations. There have been significant changes, however, in the federal securities laws, and there has been a decided shift in emphasis and orientation. Congress has involved itself in areas that traditionally have been the province of state legislatures and state courts, or federal courts applying state laws. We have yet to see the full results of the recent activity. The SEC has had a tremendous increase in its budget resources in the last six months, allowing it to be much more active in the enforcement area than it has been in the past. Regrettably, the SEC will also probably be more subject to political pressure. The SEC has traditionally been one of the least political agencies in the federal government. It will likely be more difficult for the SEC to exercise the kind of balanced judgment about corporate and securities law issues that it has in the past because of congressional pressure,
Looking AheadDevelopments are occurring now that present the risk of a significant negative change in the lawyer-client relationship, including some elements of the Sarbanes-Oxley legislation. If confidentiality and lawyer-client privilege are not treated in a judicious and balanced way, the lawyer-client relationship and the interests of clients will be threatened. What some self-proclaimed reformers do not appreciate is that the attorney-client privilege is intended for the protection of clients, not lawyers: It is the client's privilege. The purpose of the privilege is to encourage candid communications between lawyer and client, in order to facilitate the receipt by clients of good legal advice, and presumably thereby to encourage lawful behavior. If clients come to fear that their disclosures will be revealed by their lawyers because of governmental actions that threaten the lawyers, that important and laudable purpose will be frustrated. I believe that when the interests of clien
The Role of the Corporate Lawyer Morton A. Pierce Dewey Ballentine LLP Vice-Chairman, Global Chairman Corporate Department Corporate law is a very broad discipline, which addresses a wide variety of matters, from corporate formation and organizational issues and corporate governance to mergers and acquisitions and equity and debt finance. Corporate lawyers typically counsel corporate senior management, board members and investment bankers both in connection with specific transactions and with respect to everyday management and compliance matters. The focus of my practice is counseling clients in connection with mergers and acquisitions and corporate financings, as well as with respect to corporate governance matters. Adding Value As corporate counselors, we are asked not only to advise clients about what the law says, but also what it means; what other companies are doing in practice; what the potential or likely changes in the law or in practice are; and to assist our clients in makin
Giving AdviceEven if you have experience and a client comes to you with a transaction, a good corporate lawyer must be able to effectively communicate advice. The best advice I have ever received (and ever given) is to be clear and confident in the advice you give a client. Clients will feed on your confidence; it will make you a more effective counselor. The best way to be confident and, therefore, give good advice, is to understand the issues and your client’s business and objectives completely. To really understand the issues or potential issues, as well as your clients’ real objectives, you must first be able to solicit relevant information. Clients will not necessarily be able to identify the issues, but they often have most of the relevant information. Therefore, you need to be prepared. You need to understand the transaction, the law and the precedent, which takes time. So make certain you have budgeted enough time up-front (in advance of speaking with your client, the other sid
Changes in Corporate LawChanges occur in the area of corporate law and in practice every day, particularly in today’s environment of questionable corporate governance practices and disclosure issues. We need to make certain our clients are aware of and understand these changes and how to adjust their business and practices (as necessary) in response to them. Today, given the changes in technology and, in particular, the Internet, you are expected to be aware of any changes immediately – everything is instantaneous. It is not uncommon for our clients to see new material before we do and call before we have had an opportunity to review the material. You have to keep educating yourself, and you must constantly update your knowledge base. One way of maintaining our internal development, as well as providing a service to clients, is through client memoranda regarding developments in the law and/or in practice. For example, if the SEC has made an announcement or issued proposals, or if a cas
The Business of Corporate LawCorporate law is also a business, therefore, a good corporate lawyer must manage his or her existing business and think about how to grow it, whether by working with new clients or identifying opportunities with existing clients. Very often, corporate management and investment bankers will call us, based on our reputation or some experience working together. In addition to checking potential conflicts, we would determine whether we have the expertise (and, in some cases, the resources) to properly serve this potential client. Although our objective is to get as many new clients as possible, we have an obligation to take only matters that we are suited to service. We will never risk our reputation – or our potential client’s reputation – for one matter. Once we begin working with a new client, we spend some time – on our own and with our new client – understanding the client’s business and the matter for which we are being engaged. It is critical to take a s
Defining SuccessThe way to define success in our business is by measuring results: Have our clients achieved their objectives? This not only means getting the deal closed, but also leaving them and their merger partner (or new business) ready to hit the ground running. Success is never about winning every argument at the negotiating table, it is about enabling the client to realize its long-term objectives. Success is very much a function of preparation. Know your client, know the transaction, know the other side and, most importantly, know and understand what the law and the precedent would dictate. Balance your desire to let the client make all the decisions with your obligation to guide the client through often very difficult circumstances. Do not be afraid to take a position, to make a recommendation. Finally, you should always be guided by your moral compass. Although we must work to achieve our clients’ objectives, we must do it within the bounds of what the law requires, as well
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